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Coachella Music Festival May Skip 2014, Relocate if Proposed Tax Hike Goes Through

Coachella Music Festivsal California - H 2012
Frazer Harrison/Getty Images

An Indio, Calif. measure would impose a 5- to 10-percent tax on admissions to events that draw more than 2,500 people, potentially costing promoter Goldenvoice up to $6 million and concert goers $18 to $36 per ticket.

AEG Live subsidiary Goldenvoice, which produces the annual Coachella and Stagecoach music festivals at Empire Polo Club in Indio, Calif., is reportedly threatening to move the events out of Coachella Valley after 2013 if the city goes forward with a proposed admissions tax.

A proposed measure for 2014 would impose a 5- to 10-percent tax on admissions to events that draw more than 2,500 people. Goldenvoice president Paul Tollett told the Desert Sun that the tax would come out to about $36 per ticket for Goldenvoice events, which wouldn't be passed onto ticket-buyers, costing the promoter up to $6 million.

"If the tax initiative of putting $4million to $6 million onto Coachella gets on the ballot," Tollett told the paper, "we're going to take off 2014; 2015 we'll be at a new facility outside of Indio."

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In March, Goldenvoice attempted to buy the Eldorado Polo Club and three additional ranches, for a total of 280 acres of land surrounding the Empire Polo Club -- signifying a commitment that's now up in the air. An additional 600-acre purchase in the area is now "in limbo," per Tollett.

In June, the Indio City Council declined the proposed tax. However, councilman Sam Torres reportedly plans to launch a petition to put the tax on the November ballot. According to Torres, the tax would add $18 a ticket.

"We think this tax is outrageous for all the things we've done with Indio," Tollett told the Desert Sun, citing the millions of dollars of taxable revenue the festival generates each year.

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Meanwhile, Goldenvoice has already spent money on options for new venues to house Coachella and Stagecoach, Tollett told the paper. "I regret that, but I had to," he said. "There's too much uncertainty. In any other place, this festival would have had a long-term deal. We have it with the venues. With the city, it's been this year-to-year thing."

The 2012 Coachella Valley Music & Arts Festival, which took place over two weekends for the first time this year (April 13-15 and April 20-21), grossed $47,313,403 in ticket sales and drew 158,387 for the two weekends combined, according to Billboard Boxscore. The gross for this year's Stagecoach was $13,043,515, with attendance of 55,772 each of the three days, according to Boxscore.

The 2013 Coachella is scheduled for April 12-14 and April 19-21.

Twitter: @billboardbiz